Kerr v Baranow
Facts Kerr and Baranow The parties had been in a common law relationship for 26 years. Kerr was a secretary and Baranow was a longshoreman. Kerr had entered the relationship in a state of financial crisis; was just divorced with one child and the bank attempting to foreclose on her house. Baranow paid off her debts and mortgage and transferred her house and vehicle to him. Kerr moved into his house where they lived for the rest of the relationship. He paid the mortgage, shared the grocery bill. She paid the utilities for both properties, the insurance, her share of the grocery bill and did the housekeeping and cooking. Throughout the relationship they maintained separate accounts and had no joint assets. Everything they owned of significance was in one name or the other. In 1991 Kerr had a disabling stroke. As her health declined Baranow took early retirement at a reduced pension to look after her. By 2006 he was burned out and placed her in an extended care home; days later she served him with papers seeking property division. At the time of trial, Kerr had $101,000 in savings and $171,000 in RRSPs, plus a van worth $20,000. Baranow had the family home worth $942,000, savings of $525,000, RRSPs valued at $240,000 and a camper worth $5,000. Each party claimed unjust enrichment against the other. Kerr also made a claim for spousal support, but did not apply for interim support. The trial judge awarded Kerr $315,000, 1/3 of the value of the home in Baranow's name that they shared, both by way of resulting trust and unjust enrichment, based on the conclusion that she had provided $60,000 worth of equity and assets at the beginning of the relationship. Kerr was also awarded $1,739 per month in spousal support effective the day proceedings commenced. The Court of Appeal allowed the husband's appeal; Kerr did not make any financial contribution to the acquisition and improvement of the property so her claims were dismissed. The appeal court also held that commencement date of support should be the date of trial. Vanasse and Seguin Vanasse and Seguin lived in a common-law relationship for 12 years. They had two children, aged 10 and 8. When the relationship ended, Vanasse claimed spousal support, child support and compensation for unjust enrichment. While they were in a relationship, Seguin was developing a network operating system. Vanasse resigned her position at CSIS and relocated to Halifax, where the husband moved his business. She devoted herself full-time to running the household and raising the children. The trial judge concluded that the husband could not have built up the company as he did but for the wife's efforts. The husband had received $11,000,000 from the sale of the company. It was agreed that Seguin was unjustly enriched by the contributions of his partner, Vanasse, during their 12-year common law relationship. At trial, she was awarded $5,472 per month in child support and $3,800 per month in spousal support until June 2015. She was also awarded a monetary award for unjust enrichment in the amount of $996,500. The Court of Appeal set aside that award and, while ordering a new trial, directed that the proper approach to valuation was to place a monetary value on the services provided by Vanasse to the family, taking due account of Seguin's contributions by way of set-off. Issue #Is a monetary reward restricted to quantum meruit? #What is the effective date of the beginning of spousal support? Decision In Kerr, appeal on spousal support allowed; order of trial judge restored. The appeal from the order dismissing Kerr's unjust enrichment claim allowed; new trial ordered. The appeal from the order dismissing Kerr's claim in resulting trust dismissed. The order for a new hearing of Baranow's counterclaim should be affirmed. In Vanasse, appeal allowed; decision of trial judge restored. Reasons Cromwell, writing for the majority, held that with respect to the nature of the monetary remedy, the remedy for unjust enrichment was not restricted to an award based on a fee-for-services approach. Where the unjust enrichment was most realistically characterized as one party retaining a disproportionate share of assets resulting from a joint family venture, and a monetary award was appropriate, it should be calculated on the basis of the share of those assets proportionate to the claimant's contributions. For the claimant to prove there was a joint family venture, they must provide evidence of: #'mutual effort' #*Did the parties work collaboratively to common goals? #*Did the couple have children? #*How long was the relationship? #'economic integration' #*Did they have any joint assets? #*Did they share expenses and accumulate common savings? #**Basic expense sharing only evidence of cohabitation. #'actual intention of the parties' #*What did the parties intend to do? #*Was it always intended that each would keep their own portion? #*How to determine intentions: #**Jointly owned property probably suggests an intention to share #**Remembering your common law partner in your will #**How much attention was paid to who paid for what and when? If there was little attention paid, that is strong evidence that they intended to share. #*What if the parties intentions are not the same? #**Parties ought to have known of the other's intention to share. #'priority of the family' #*Is the whole greater than the sum of its parts? #*Did one or both spouses sacrifice something for the sake of the family unit? #**Includes everything from staying home for a time to raise children, not taking a promotion, accepting underemployment in order to balance family duties. Once a joint family venture has been established, the plaintiff must demonstrate a link or causal connection between his or her contributions and the acquisition, preservation, maintenance or improvement of the disputed property, and that a monetary award would be insufficient, at which point a share of the property proportionate to the claimant's contribution could be impressed with a constructive trust in his or her favour (i.e. there is not a presumption of an equal share). Where the contributions of both parties over time resulted in an accumulation of wealth, an unjust enrichment occurred when one party retained a disproportionate share of the assets that were the product of their joint efforts following the breakdown of their relationship. For cases where no joint family venture exists, the court was less clear. The value survived approach (the increase in value of an asset since cohabitation) was approved, but little guidance was given as to when it should be used. Vanasse and Seguin There was a clear link between Vanasse's contribution and the accumulation of wealth. The trial judge took a realistic and practical view of the evidence and took into account Seguin's non-financial contributions and periods during which Vanasse's contributions were not disproportionate to Seguin and thus her judgment should be restored. Spousal support re: Kerr The court held that the general rule is that support is granted back to the date of the initial application, based on not wanting to penalize the recipient based on how long the case takes to get to trial. When considering how far back spousal support should go, the court will consider: *whether support was sought effective from the commencement of proceedings; *the conduct of the payor broadly relevant to the support obligation; *the circumstances of the spouse seeking support; and *any hardship occasioned by the award. The Court of Appeal made two errors in changing the date of retroactivity to the date of trial: #They stated that Kerr had no need despite the fact she was living in a long-term care facility with three other people, and wanted support to have private room. #They also faulted Kerr for not applying for interim spousal support. The Supreme Court points out that interlocutory applications have high physical, financial and emotional legal costs; requiring interim applications prolongs rather than expedites proceedings. Ratio *Monetary damages are not restricted to quantum meruit. *To demonstrate a joint family venture, the complainant must adduce evidence of: **mutual effort **economic integration **actual intent **priority of the family *If a joint family venture can be proven, then if the applicant can demonstrate a link between their contributions and that a monetary award would be insufficient, they are entitled to a share of the assets proportionate to their contributions. *To be entitled to a monetary remedy from a joint family venture, the claimant must show both **that a joint family venture exists, and **that there is a link between his/her contributions to it and the accumulation of assets/wealth. *As a general rule, spousal support begins at the date of the initial application, though the court has discretion to choose the appropriate date in light of the circumstances. Category:Property law Category:Matrimonial and family property Category:Cases from Canada Category:Supreme Court of Canada cases Category:Family law Category:Property division Category:Property rights of common law couples Category:Spousal support Category:Effective date of spousal support